Question

What are the main difficulties of JIT implementation in small firms?

Answer 1

Just in time production

It is a time management philosophy where the most important and valuable resource, i.e time, is utilized efficiently, thus reducing in various other associated costs.

However, not every business is able to benefit from the implementation of JIT philosophy. The small firms usually face more difficulties in its implementation and end up paying more costs. Those difficulties are as follows-

1) In frequent purchases

Small business have usually less demand as compared to large business. Hence, they make small in frequent purchase orders and end up being denied for the higher discounts provided on bulk purchases.

2) Timely completion

Small business lack in enhanced production methodologies to able to meet current demand within time. They need to have some inventories so that it could achieve effectiveness, which is not allowed as per JIT philosophy.

3) Unpreparedness for unforeseen or natural threats

Small business usually end up being closed when following JIT philosophy and being victim to unforeseen or natural threats such as natural calamities, political changes, etc.